·Decrease the power of its buyers.·Increase its own supplier power.·Increase switching costs to reduce the
threat of substitute products or services.·Create entry barriers thereby reducing the
threat of new entrants.·Increase efficiencies while seeking a
competitive advantage through cost leadership

Effective and efficient SCM systems effect on Porter’s Five
Forces

Customer Relationship Management (CRM)

·Involves managing all aspects of a
customer’s relationship with an organization to increase customer loyalty and
retention and an organization's profitability.

·Many organizations, such as Charles Schwab
and Kaiser Permanente, have obtained great success through the implementation
of CRM systems.

·CRM is not just technology, but a strategy,
process, and business goal that an organization must embrace on an enterprise wide
level.

·CRM can enable an organization to:

üIdentify
types of customers

üDesign
individual customer marketing campaigns

üTreat
each customer as an individual üUnderstand
customer buying behaviors

Business Process Reengineering (BPR)ØBusiness process

·A standardized set of activities that
accomplish a specific task, such as processing a customer’s order.

ØBusiness process re-engineering (BPR)

·The analysis and redesign of workflow
within and between enterprises.

·The purpose of BPR is to make all business
processes best-in-class.

·Types of change an organization can achieve,
along with the magnitudes of change and the potential business benefit.

SEVEN PRINCIPLES OF BUSINESS PROCESS
RE-ENGINEERING

1)Organize around outcomes, not tasks.

2)Identify all the organization’s process and
prioritize then in order of redesign urgency.

3)Integrate information processing work into
the real work that produces the information.

4)Treat geographically dispersed resources as
though they were centralized.

5)Link parallel activities in the workflow
instead of just integrating their results.

6)Put the decision point where the work is
performed, and build control into process.

7)Capture information once and at the source.

Finding opportunity using BPR

·A company can improve the way it travels
the road by moving from foot to horse and then horse to car.

·BPR looks at taking a different path, such
as an airplane which ignore the road completely.

·Progressive Insurance Mobile Claims Process.

·Types of change an organization can
achieve, along with the magnitudes of change and the potential business benefit.

Pitfalls
of BPR

ᴥFails to keep up with competitors

Enterprise Resource Planning

Enterprise resource
planning (ERP)

·Integrates all departments and functions
throughout an organization into a single IT system

· So that employees can make decisions by
viewing enterprise wide information on all business